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Published: Saturday, August 24, 2013 at 11:27 p.m.

Last Modified: Saturday, August 24, 2013 at 11:27 p.m.

Just when we in the Wilmington area thought it was safe to believe that finally, really, we are emerging from the worst economic downturn in recent decades, along comes a Gloomy Gus suggesting that maybe we're not on a straight road to recovery.

Such has been the case with the housing industry, which has taken much longer in our region than in other parts of the nation. For the most part, the Cape Fear region is holding its own. Building permits and housing starts are up, and home sales rose an impressive 38 percent last month compared with July 2012. Prices are up, too, although they may never reach the inflated levels that reigned before the Great Recession hit. Anecdotally, builders and real estate agents are more optimistic than they have been since early 2008 – before the Wilmington area felt the brunt of the recession.

Yet it's not good enough to impress the people behind RealtyTrac, a national index that declares Wilmington's housing market one of the weakest in the nation. Number one? Rochester, N.Y.

While local members more familiar with our housing market pointed to a number of flaws, the index is correct on at least one point: The region's unemployment rate is still higher than the rest of the nation, and that has to have a negative impact on not only housing sales but on the economic recovery in general.

And while housing sales are clipping along at a healthy pace nationally and locally, rising mortgage interest rates have put a damper on new-home sales nationwide. Whether that will affect our market dramatically remains to be seen, but despite climbing to an average of a little under 4.6 percent, mortgage interest rates are still low by historical comparison.

We cannot ignore signs that the road to recovery may get a bit more bumpy, but our focus should be on the activity we're seeing in the area, and on an unemployment rate that, while still too high, has come down significantly from recession highs.

Jobs are still too scarce, and too many jobs that are being created do not pay enough to put a family in the homebuying market. Underemployment – low-wage jobs and part-time rather than full-time work – is prevalent in this "recovery." Many people, even if their income has rebounded, are left with stagnant wages. People in that situation hesitate to jump into the home market, which may also explain the significant increase in new construction of rental housing.

Yet if we think back three or four years, we can see that construction activity is up and that houses are selling – the average length on the market was around 123 days in July, down from 161 (but still higher than at the peak of the housing boom, when houses were selling after an average of less than 60 days). Home sellers are reporting multiple bids, a sign that prices have stabilized and should continue to rise in the short term.

And economists, if you can believe the dismal-science bunch, expect that the national housing market overall will continue to get stronger.

But RealtyTrac's Housing Market Index, as well as periodic dips in some economic indicators, should remind us that this is a long and difficult journey rather than a short trip to prosperity.

<p>Just when we in the Wilmington area thought it was safe to believe that finally, really, we are emerging from the worst economic downturn in recent decades, along comes a Gloomy Gus suggesting that maybe we're not on a straight road to recovery.</p><p>Such has been the case with the housing industry, which has taken much longer in our region than in other parts of the nation. For the most part, the Cape Fear region is holding its own. Building permits and housing starts are up, and home sales rose an impressive 38 percent last month compared with July 2012. Prices are up, too, although they may never reach the inflated levels that reigned before the Great Recession hit. Anecdotally, builders and real estate agents are more optimistic than they have been since early 2008 – before the Wilmington area felt the brunt of the recession.</p><p>Yet it's not good enough to impress the people behind RealtyTrac, a national index that declares Wilmington's housing market one of the weakest in the nation. Number one? Rochester, N.Y.</p><p>While local members more familiar with our housing market pointed to a number of flaws, the index is correct on at least one point: The region's unemployment rate is still higher than the rest of the nation, and that has to have a negative impact on not only housing sales but on the economic recovery in general.</p><p>And while housing sales are clipping along at a healthy pace nationally and locally, rising mortgage interest rates have put a damper on new-home sales nationwide. Whether that will affect our market dramatically remains to be seen, but despite climbing to an average of a little under 4.6 percent, mortgage interest rates are still low by historical comparison.</p><p>We cannot ignore signs that the road to recovery may get a bit more bumpy, but our focus should be on the activity we're seeing in the area, and on an unemployment rate that, while still too high, has come down significantly from recession highs.</p><p>Jobs are still too scarce, and too many jobs that are being created do not pay enough to put a family in the homebuying market. Underemployment – low-wage jobs and part-time rather than full-time work – is prevalent in this "recovery." Many people, even if their income has rebounded, are left with stagnant wages. People in that situation hesitate to jump into the home market, which may also explain the significant increase in new construction of rental housing.</p><p>Yet if we think back three or four years, we can see that construction activity is up and that houses are selling – the average length on the market was around 123 days in July, down from 161 (but still higher than at the peak of the housing boom, when houses were selling after an average of less than 60 days). Home sellers are reporting multiple bids, a sign that prices have stabilized and should continue to rise in the short term.</p><p>And economists, if you can believe the dismal-science bunch, expect that the national housing market overall will continue to get stronger.</p><p>But RealtyTrac's Housing Market Index, as well as periodic dips in some economic indicators, should remind us that this is a long and difficult journey rather than a short trip to prosperity.</p>